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Stocks drift before US jobs data, oil declines

London - Stocks drifted and government bonds slipped as investors pondered the latest drama in Washington while they wait for new clues on the US economy. The euro touched a fresh two-and-a-half year high against the dollar and oil retreated.

The benchmark European share gauge eventually edged higher even as Swiss Re’s profit drop weighed on insurers, and S&P index futures also rose. The dollar index was headed for a fourth straight weekly decline after Special Counsel Robert Mueller was said to be using a federal grand jury to help collect information as he probes Russia’s meddling in the 2016 election.

Treasuries yields rose, while crude dropped amid rising output from the US and OPEC.

While the news of the Russia probe once again meant geopolitics took center stage for markets, the US employment report may later steal the show. Investors are trying to figure out how strong the world’s largest economy really is and what the Federal Reserve’s next policy move will be.

The jobs report for July may show the economy is on a steady trajectory and the labour market is staying tight, according to Bloomberg Intelligence. Consensus expects an increase of 180 000 in non-farm payrolls, after a gain of 222 000 in June, and a decline in unemployment to 4.3% from 4.4%. The data will also signal if income gains are enough to keep consumer spending ticking.

Here are the main moves in markets:

Stocks

• The Stoxx Europe 600 Index climbed 0.1% as of 14:02.

• The UK's FTSE 100 Index also rose 0.1%.

• Germany’s DAX Index increased 0.2%. 

• The MSCI All-Country World Index gained less than 0.05%.

• Futures on the S&P 500 Index advanced 0.1%.

Currencies

• The Bloomberg Dollar Spot Index climbed less than 0.05%, paring its decline this week to 0.2%.

• The euro increased less than 0.05% after rising as much as 2% to a two-and-a-half year high.

• The common currency is heading for a weekly gain of 1%, its fourth in succession.

• The British pound added less than 0.05%.

Bonds

• The yield on 10-year Treasuries advanced one basis point to 2.23%.

• Germany’s 10-year yield gained one basis point to 0.46%. 

• Britain’s 10-year yield climbed one basis point to 1.16%.

Commodities

• West Texas Intermediate crude dipped 0.4% to $48.85 a barrel.

• Crude is down 1.8% this week after last week’s 8.6% rise.

• Gold was little changed at $1 268.42 an ounce. 

• Copper advanced 0.2% to $2.88 a pound.

Asia

• Japan’s Topix index slid 0.2% and Australia’s S&P/ASX 200 Index lost 0.3%.

• South Korea’s Kospi was up 0.4% after sliding 1.7% on Thursday.

• Hong Kong’s Hang Seng Index added 0.1 %, while the Shanghai Composite Index swung between gains and losses before ending down.

• The Japanese yen dipped less than 0.1% to 110.12 per dollar.

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